[Federal Register Volume 85, Number 40 (Friday, February 28, 2020)]
[Notices]
[Pages 12017-12030]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-04119]


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DEPARTMENT OF JUSTICE

Antitrust Division


United States v. Olympus Growth Fund VI, L.P., et al.; Proposed 
Final Judgment and Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment, 
Stipulation, and Competitive Impact Statement have been filed with the 
United States District Court for the District of Columbia in United 
States of America v. Olympus Growth Fund VI, L.P., et al., Civil Action 
No. 1:20-cv-00464. On February 19, 2020, the United States filed a 
Complaint alleging that the proposed acquisition of the Plastics 
Division of DS Smith plc by Olympus Growth Fund VI, L.P., through its 
portfolio company Liqui-Box, Inc., would violate Section 7 of the 
Clayton Act, 15 U.S.C. 18. The proposed Final Judgment, filed at the 
same time as the Complaint, requires Defendants to divest all of DS 
Smith's Bag-in-Box (BiB) product lines that overlap with BiB product 
lines offered by Liqui-Box in the United States, including those for 
dairy, post-mix, smoothie, and wine.
    Copies of the Complaint, proposed Final Judgment, and Competitive 
Impact Statement are available for inspection on the Antitrust 
Division's website at http://www.justice.gov/atr and at the Office of 
the Clerk of the United States District Court for the District of 
Columbia. Copies of these materials may be obtained from the Antitrust 
Division upon request and payment of the copying fee set by Department 
of Justice regulations.
    Public comment is invited within 60 days of the date of this 
notice. Such comments, including the name of the submitter, and 
responses thereto, will be posted on the Antitrust Division's website, 
filed with the Court, and, under certain circumstances, published in 
the Federal Register Comments should be directed to Katrina Rouse, 
Chief, Defense, Industrials, and Aerospace Section, Antitrust Division, 
Department of Justice, 450 Fifth Street NW, Suite 8700, Washington, DC 
20530 (telephone: 202-598-2459).

Amy Fitzpatrick,
Counsel to the Senior Director of Investigations and Litigation.

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

    UNITED STATES OF AMERICA, U.S. Department of Justice, Antitrust 
Division, 450 5th Street NW, Suite 8700, Washington, DC 20530, 
Plaintiff, v. OLYMPUS GROWTH FUND VI, L.P., One Station Place, 
Stamford, CT 06902, LIQUI-BOX, INC., 901 E. Byrd Street, Richmond, 
VA 23219, and DS SMITH PLC, 350 Euston Road, London, NW1 3AX, 
Defendants.

Civil Action No.: 1:20-cv-00464
Judge: Hon. Christopher Cooper

Complaint

    The United States of America (``United States''), acting under the 
direction of the Attorney General of the United States, brings this 
civil antitrust action against Defendants Olympus Growth Fund VI, L.P. 
(``Olympus''), Liqui-Box, Inc. (``Liqui-Box''), and DS Smith plc (``DS 
Smith'') to enjoin Olympus's proposed acquisition of DS Smith's 
Plastics Division (``DS Smith Plastics''), through Liqui-Box, a 
portfolio company of Olympus. The United States complains and alleges 
as follows:

I. Nature of the Action

    1. Pursuant to a Stock Purchase Agreement dated March 5, 2019, 
Liqui-Box proposes to acquire DS Smith Plastics for approximately $500 
million, making the combined company one of the largest bag-in-box 
(``BiB'') suppliers in the United States.
    2. BiBs are engineered plastic bags used to store and dispense 
liquids such as milk, post-mix (e.g., soda syrups and other beverage 
concentrates), smoothies, and wine. BiBs are made up of a single or 
multi-layer plastic film bag and an attached fitment, which is a 
plastic component used to facilitate the transfer of the liquids into 
and out of the bags. After a BiB is manufactured, it is shipped empty 
to the customer, who fills the BiB with liquid and then sells the 
filled BiB. Customers, such as dairies, soft-drink manufacturers, and 
other food producers, rely on BiBs to preserve and safely transport 
their liquids to restaurants, convenience stores, other food service 
operators, and retail outlets.
    3. In the United States, Liqui-Box and DS Smith are two of only 
three significant suppliers of BiBs for nearly all end uses, including 
dairy, post-mix, and smoothies. Liqui-Box and DS Smith also are two of 
only four significant suppliers of BiBs for wine in the United States. 
The proposed acquisition will eliminate competition between Liqui-Box 
and DS Smith to supply these BiBs to customers and is likely to lead to 
increased prices, lower quality and service, and less innovation.
    4. As a result, the proposed acquisition likely would substantially 
lessen competition for the development, manufacture, and sale of dairy, 
post-mix, smoothie, and wine BiBs in the United States in violation of 
Section 7 of the Clayton Act, 15 U.S.C. 18, and should be enjoined.

II. The Parties and the Transaction

    5. Olympus, a fund managed by private equity firm Olympus Partners, 
is a Delaware limited partnership with headquarters in Stamford, 
Connecticut. In 2018, Olympus Partners had approximately $8.5 billion 
total capital under management between its different funds, with 
Olympus comprising approximately $2.3 billion of that total.
    6. Liqui-Box, a company owned by Olympus, is a Delaware corporation 
with headquarters in Richmond, Virginia. Liqui-Box is a global 
manufacturer of packaging and packaging equipment, including BiBs, with 
four U.S. manufacturing facilities, as well as additional facilities 
across the world. In 2018, Liqui-Box had total sales of $177 million, 
including approximately $123 million in the United States.
    7. DS Smith is a United Kingdom public limited company with 
headquarters in London, England. DS Smith is a global manufacturer of 
packaging, packaging equipment, and recycled paper. DS Smith operates 
DS Smith Plastics, a division that manufactures flexible packaging and 
dispensing solutions, rigid packaging, injection-molded products, and 
foam products. Among DS Smith Plastics' flexible packaging products are 
BiBs, which are primarily sold under the Rapak brand name in the United 
States. DS Smith Plastics has its U.S. headquarters in Romeoville, 
Illinois,

[[Page 12018]]

and operates five plants in the United States, as well as additional 
plants across the world. In 2018, DS Smith Plastics had total sales of 
$479 million, including approximately $137 million in sales of BiBs and 
other goods in the United States.
    8. Pursuant to a Stock Purchase Agreement dated March 5, 2019, 
Liqui-Box agreed to acquire DS Smith Plastics for approximately $500 
million.

III. Jurisdiction and Venue

    9. The United States brings this action under Section 15 of the 
Clayton Act, 15 U.S.C. 25, to prevent and restrain Defendants from 
violating Section 7 of the Clayton Act, 15 U.S.C. 18.
    10. Defendants develop, manufacture, and sell BiBs throughout the 
United States in the flow of interstate commerce. Defendants' 
activities in the development, manufacture, and sale of BiBs 
substantially affect interstate commerce. This Court has subject-matter 
jurisdiction over this action pursuant to Section 15 of the Clayton 
Act, 15 U.S.C. 25, and 28 U.S.C. 1331, 1337(a), and 1345.
    11. Defendants have consented to venue and personal jurisdiction in 
this District. Venue is proper in this District under Section 12 of the 
Clayton Act, 15 U.S.C. 22, and 28 U.S.C. 1391(c).

IV. Industry Background

    12. BiBs are used to store and dispense liquids such as milk, post-
mix, smoothies, and wine. The components of a BiB include a flexible 
plastic bag and an attached fitment. BiBs typically hold between one 
and six gallons of liquid, but they also come in smaller and larger 
sizes. The attached fitment facilitates the transfer of liquids into 
and out of the bag.
    13. The flexible plastic bag component of a BiB is typically made 
up of one to five layers of film. The films are most often made of 
polyethylene (``PE''), but also can be made with ethylene vinyl alcohol 
(``EVOH'') or other materials, and are bound together using heat 
sealing. Customers require different numbers and types of layers to 
meet individual product demands. For example, the most basic bags 
consist of a single layer of PE that secures the liquid during 
transport. More sophisticated bags have additional layers of engineered 
film that add durability, metallization, and oxygen, moisture, or 
temperature resistance.
    14. The fitment component of a BiB typically is made from resin 
using injection molding and attached to the flexible plastic bag 
component via heat sealing. The design of the fitment is determined by 
the liquid that will go into the bag and the method that will be used 
to dispense the liquid out of the bag. For example, if the BiB is used 
to dispense post-mix into a soda dispenser, the fitment will be 
designed to attach to a soda dispenser. The simplest fitment is a basic 
cap, which can be flipped off or unscrewed to pour out the liquid. 
Highly engineered fitments can have specialized elements such as a 
built-in push-tap feature or an oxygen barrier to provide resistance to 
the elements. Fitments are often protected by patents due to the 
specialized nature and high degree of engineering that can be required 
in fitment manufacturing.
    15. BiBs are shipped to the customer who fills the BiB with liquid 
using a filler machine that the customer typically purchases or leases 
from the BiB supplier. The customer then ships the filled BiB to a 
store, restaurant, or other food processor. For example, a post-mix 
manufacturer seeking to distribute its post-mix to a convenience store 
would purchase BiBs and a filler machine from a BiB supplier, fill the 
BiBs with the post-mix at its own facility, and then ship the filled 
BiBs to the convenience store for use in the convenience store's 
dispensing machine.
    16. BiBs are distinct from and have numerous advantages over other 
forms of packaging. For example, compared to rigid containers (e.g., 
jugs and bottles) and cartons, which are the other primary forms of 
packaging used for storing and transporting liquids, BiBs are smaller 
and thus reduce storage space and shelf space, both when empty and 
filled. In addition, BiBs can be a more hygienic form of dispensing 
liquids because they can reduce user contact and thus contamination. 
Further, BiBs can keep their contents fresher for longer than other 
types of packaging by allowing for minimal contact with air. Finally, 
BiBs can be more economical because they have features that allow the 
user to get all the liquid out of the bag and result in less packaging 
waste when they are empty and disposed of.

V. Relevant Markets

A. Product Markets

1. Dairy BiBs
    17. BiBs for dairy products hold liquids such as ice cream mix, 
yogurt, milk, and cream. Dairy BiBs are typically durable bags made 
from PE and often have a flip-cap or screw-off cap fitment. Dairy BiBs 
are designed to reduce the risk of contamination and extend shelf life.
    18. There are no substitutes for dairy BiBs. Dairy BiBs provide 
dairy liquids to customers in an easy to use, inexpensive format that 
other packaging does not offer. For example, rigid containers require 
more storage space, may not keep the dairy liquid as fresh, and may 
have a higher risk of contamination. BiBs for other end uses cannot be 
substituted for dairy BiBs due to the unique specifications for dairy 
BiBs.
    19. In the event of a small but significant non-transitory price 
increase for dairy BiBs, customers would not substitute away from dairy 
BiBs in a sufficient volume to make the price increase unprofitable. 
Therefore, the development, manufacture, and sale of dairy BiBs is a 
relevant product market and line of commerce within the meaning of 
Section 7 of the Clayton Act, 15 U.S.C. 18.
2. Post-Mix BiBs
    20. Post-mix BiBs hold concentrated drink mixes such as soda syrup 
and juice concentrates. These concentrates are often mixed with 
carbonated or non-carbonated water before being served. Post-mix BiBs 
are typically made with layers of PE or EVOH and a fitment that 
attaches to a drink dispensing machine. Bags used for post-mix must be 
very strong to accommodate high filling flow rates required by post-mix 
manufacturers. Post-mix BiBs are designed to maintain freshness and 
ensure all liquid is dispensed from the bag while minimizing leaks and 
spills and accurately dispensing the product.
    21. There are no substitutes for post-mix BiBs. Post-mix BiBs must 
attach to a dispensing machine, which a rigid container cannot do. 
Moreover, BiBs for other end uses cannot be substituted for post-mix 
BiBs due to the unique fitments and bag design required for post-mix 
BiBs.
    22. In the event of a small but significant non-transitory price 
increase for post-mix BiBs, customers would not substitute away from 
post-mix BiBs in a sufficient volume to make the price increase 
unprofitable. Therefore, the development, manufacture, and sale of 
post-mix BiBs is a relevant product market and line of commerce within 
the meaning of Section 7 of the Clayton Act, 15 U.S.C. 18.
3. Smoothie BiBs
    23. Smoothie BiBs hold mixes and other ingredients for smoothies 
and other drinks. Smoothie BiBs are typically made with layers of PE 
that offer low oxygen permeability. Like post-mix BiBs, most fitments 
on smoothie BiBs are designed to be

[[Page 12019]]

attached to dispensing machines and are highly specialized for the 
particular types of machines they attach to. A smoothie BiB typically 
has a special cap into which a probe is inserted in order to dispense 
the liquid. Smoothie BiBs are designed to maintain the safety and 
freshness of the liquid, protect the taste and quality of these flavor-
sensitive liquids, and reduce the risk of contamination.
    24. There are no substitutes for smoothie BiBs. Rigid containers 
cannot be attached to the dispensing machines smoothie BiBs are used 
in. Further, rigid containers are more expensive and bulkier to 
transport, may not keep the liquid as fresh, and may have a higher risk 
of contamination. Moreover, BiBs for other end uses cannot be 
substituted for smoothie BiBs due to the unique specifications required 
for smoothie BiBs. Fitments for smoothie BiBs, for example, often are 
designed to specifically interact with the dispensing machines.
    25. In the event of a small but significant non-transitory price 
increase for smoothie BiBs, customers would not substitute away from 
smoothie BiBs in a sufficient volume to make the price increase 
unprofitable. Therefore, the development, manufacture, and sale of 
smoothie BiBs is a relevant product market and line of commerce within 
the meaning of Section 7 of the Clayton Act, 15 U.S.C. 18.
4. Wine BiBs
    26. Wine BiBs hold the wine inside of boxed wines, which are often 
sold in retail outlets. The bag component of wine BiBs is typically 
made from PE and EVOH and is designed to protect against oxidation and 
UV light. The fitment for wine BiBs is typically a push, pull, or twist 
tap that is specifically designed to avoid allowing oxygen into the bag 
when the wine is dispensed. This provides a longer shelf life for wine 
once opened as compared to traditional bottles. Because the fitments 
for wine BiBs are operated directly by individuals, they must be simple 
to operate and user friendly.
    27. There are no substitutes for wine BiBs. BiBs for other end uses 
cannot be substituted for wine BiBs due to the unique specifications 
for wine BiBs. Both the bag and fitment are specially engineered to 
provide an oxygen barrier for the product that other BiBs typically do 
not provide. Bags and fitments that lack this specialized oxygen 
barrier would allow oxygen to seep in and degrade the wine, making it 
unsuitable for consumption after only a short time. Wine bottles are 
not adequate substitutes for wine BiBs. A wine BiB can keep wine fresh 
for up to four weeks after it is opened, significantly longer than a 
wine bottle can. Also, wine BiBs provide faster and more sanitary 
pouring for food service operators than bottles do, with no risk of 
broken glass.
    28. In the event of a small but significant non-transitory price 
increase for wine BiBs, customers would not substitute away from wine 
BiBs in a sufficient volume to make the price increase unprofitable. 
Therefore, the development, manufacture, and sale of wine BiBs is a 
relevant product market and line of commerce within the meaning of 
Section 7 of the Clayton Act, 15 U.S.C. 18.

B. Geographic Market

    29. Customers in the United States do not purchase dairy, post-mix, 
smoothie, and wine BiBs (collectively, the ``Relevant BiB Products'') 
from suppliers located outside the United States. Shipping these 
products from outside the United States generally would not be 
economical because the shipping costs are too large relative to the 
cost of the BiB itself. In addition, BiBs manufactured and sold outside 
the United States often have different specifications than those 
manufactured and sold in the United States due to, for example, 
differences in the liquids stored in the BiBs or differences in 
dispensing machines. Further, it is important for a supplier of BiBs in 
the United States to be able to timely provide service to its customers 
who have issues with the BiBs, such as leakage or breakage of the bags 
or problems with the attachment of the BiBs to the filler machines. 
Suppliers located outside the United States do not have employees 
located in the United States to timely service BiB customers in the 
United States.
    30. In the event of a small but significant non-transitory increase 
in the price of the Relevant BiB Products, customers in the United 
States would not procure these products from suppliers located outside 
the United States in a sufficient volume to make such a price increase 
unprofitable. Accordingly, the United States is a relevant geographic 
market within the meaning of Section 7 of the Clayton Act, 15 U.S.C. 
18.

VI. Anticompetitive Effects

    31. Liqui-Box, DS Smith, and one other company are the only 
significant suppliers of dairy, post-mix, and smoothie BiBs to 
customers located in the United States. Liqui-Box and DS Smith are two 
of only four suppliers of wine BiBs to customers located in the United 
States.
    32. Liqui-Box and DS Smith compete vigorously with one another on 
the basis of price, quality, and service in the markets for the 
Relevant BiB Products in the United States. Competition between Liqui-
Box and DS Smith has fostered innovation and led to the development of 
new types of BiBs and product features. The proposed acquisition would 
eliminate the substantial head-to-head competition between Liqui-Box 
and DS Smith and the benefits that customers have realized from that 
competition in the form of lower prices, better quality and service, 
and innovation. By eliminating DS Smith as a competitor in the 
development, manufacture, and sale of the Relevant BiB Products in the 
United States, the proposed acquisition of DS Smith Plastics would 
substantially increase the likelihood that Liqui-Box would increase 
prices, reduce quality and service, and diminish investment in research 
and development below what it would have been absent the acquisition.
    33. The proposed acquisition, therefore, would likely substantially 
lessen competition in the development, manufacture, and sale of the 
Relevant BiB Products in the United States in violation of Section 7 of 
the Clayton Act, 15 U.S.C. 18.

VII. Entry

    34. Entry into the development, manufacture, and sale of the 
Relevant BiB Products would not be timely, likely, or sufficient to 
prevent the harm to competition caused by Liqui-Box's proposed 
acquisition of DS Smith Plastics.
    35. Entry into the markets for the Relevant BiB Products is costly 
and time consuming. Significant upfront capital expenditures are 
required to enter. The machinery to manufacture BiBs, including 
injection molding machines for the fitments and production lines that 
seal the bags and attach the fitments, is expensive and highly 
engineered. Manufacturing BiBs in accordance with customer requirements 
requires skilled employees and industry know-how that can take years to 
establish. Further, customers demand that suppliers have a proven 
ability to supply BiBs with the required specifications so that their 
BiBs do not leak or break and are able to store the liquids for the 
required amount of time without spoiling. This reputation for having a 
quality product takes significant time to build. Finally, a new entrant 
would need to hire trained technicians capable of providing timely 
service to customers when BiBs leak, break, or encounter other product 
quality issues.

[[Page 12020]]

VIII. Violations Alleged

    36. The acquisition of DS Smith Plastics by Liqui-Box is likely to 
substantially lessen competition in each of the relevant markets set 
forth above in violation of Section 7 of the Clayton Act, 15 U.S.C. 18.
    37. The transaction will likely have the following anticompetitive 
effects, among others, in the relevant markets:
    a. Competition between Liqui-Box and DS Smith will be eliminated;
    b. competition generally will be substantially lessened; and
    c. prices will likely increase, quality and the level of service 
will likely decrease, and innovation will likely decline.

IX. Request for Relief

    38. The United States requests that this Court:
    a. Adjudge and decree Liqui-Box's acquisition of DS Smith Plastics 
to be unlawful and in violation of Section 7 of the Clayton Act, 15 
U.S.C. 18;
    b. enjoin Defendants and all persons acting on their behalf from 
consummating the proposed acquisition of DS Smith Plastics by Liqui-Box 
or from entering into or carrying out any other agreement, plan, or 
understanding the effect of which would be to combine Liqui-Box with DS 
Smith Plastics;
    c. award the United States its costs of this action; and
    d. grant the United States such other relief as the Court deems 
just and proper.

Dated: February 19, 2020.

Respectfully submitted,

FOR PLAINTIFF UNITED STATES:
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Makan Delrahim,
(D.C. Bar #457795)

Assistant Attorney General.
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Katrina H. Rouse,
(D.C. Bar #1013035)

Chief, Defense, Industrials, and Aerospace Section.
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Bernard A. Nigro, Jr.,
(D.C. Bar #412357)

Principal Deputy Assistant Attorney General.
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David E. Altschuler,
(D.C. Bar #983023)

Assistant Chief, Defense, Industrials, and Aerospace Section.
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Kathleen S. O'Neill,

Senior Director of Investigations & Litigation.
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Jay D. Owen,

Assistant Chief, Defense, Industrials, and Aerospace Section.
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Christine A. Hill,*
(D.C. Bar #461048)

Rebecca Valentine,
(D.C. Bar #989607)

Daniel J. Monahan, Jr.,

Attorneys for the United States, Defense, Industrials, and Aerospace 
Section, U.S. Department of Justice, Antitrust Division, 450 Fifth 
Street NW, Suite 8700, Washington, DC 20530, Telephone: (202) 305-
2738, Facsimile: (202) 514-9033, Email: [email protected].

* Lead Attorney To Be Noticed.

United States District Court for the District of Columbia

United States of America, Plaintiff, v. Liqui-Box, Inc., Olympus 
Growth Fund VI, L.P., and DS Smith PLC, Defendants.

Civil Action No.: 1:20-cv-00464

Judge: Hon. Christopher Cooper

Proposed Final Judgment

    Whereas, Plaintiff, United States of America, filed its Complaint 
on February 19, 2020, the United States and Defendants, Liqui-Box, 
Inc., Olympus Growth Fund VI, L.P., and DS Smith plc, by their 
respective attorneys, have consented to the entry of this Final 
Judgment without trial or adjudication of any issue of fact or law and 
without this Final Judgment constituting any evidence against or 
admission by any party regarding any issue of fact or law;
    And whereas, Defendants agree to be bound by the provisions of this 
Final Judgment pending its approval by the Court;
    And whereas, the essence of this Final Judgment is the prompt and 
certain divestiture of certain rights or assets by Defendants to assure 
that competition is not substantially lessened;
    And whereas, Defendants agree to make certain divestitures for the 
purpose of remedying the loss of competition alleged in the Complaint;
    And whereas, Defendants have represented to the United States that 
the divestiture required below can and will be made and that Defendants 
will not later raise any claim of hardship or difficulty as grounds for 
asking the Court to modify any of the divestiture provisions contained 
below;
    Now therefore, before any testimony is taken, without trial or 
adjudication of any issue of fact or law, and upon consent of the 
parties, it is ordered, adjudged, and decreed:

I. Jurisdiction

    The Court has jurisdiction over the subject matter of and each of 
the parties to this action. The Complaint states a claim upon which 
relief may be granted against Defendants under Section 7 of the Clayton 
Act, as amended (15 U.S.C. 18).

II. Definitions

    As used in this Final Judgment:
    A. ``Acquirer'' means TriMas or another entity to whom Defendants 
divest the Divestiture Assets.
    B. ``Liqui-Box'' means Defendant Liqui-Box, Inc., a Delaware 
corporation with its headquarters in Richmond, Virginia; its successors 
and assigns; and its subsidiaries, divisions, groups, affiliates, 
partnerships, and joint ventures, and their directors, officers, 
managers, agents, and employees.
    C. ``Olympus Growth'' means Defendant Olympus Growth Fund VI, L.P., 
a Delaware limited partnership with its headquarters in Stamford, 
Connecticut; its successors and assigns; and its subsidiaries, 
divisions, groups, affiliates, partnerships, and joint ventures, and 
their directors, officers, managers, agents, and employees.
    D. ``DS Smith'' means Defendant DS Smith plc, a United Kingdom 
corporation with the U.S. headquarters of its Plastics Division in 
Romeoville, Illinois; its successors and assigns; and its subsidiaries, 
divisions, groups, affiliates, partnerships, and joint ventures, and 
their directors, officers, managers, agents, and employees.
    E. ``TriMas'' means TriMas Corporation, a Delaware corporation with 
its headquarters in Bloomfield Hills, Michigan; its successors and 
assigns; and its subsidiaries, divisions, groups, affiliates, 
partnerships, and joint ventures, and their directors, officers, 
managers, agents, and employees.
    F. ``BiB Products'' means all components of Bag-in-Box (``BiB'') 
packaging and solutions, including, but not limited to, bags and 
fitments, whether the bags or fitments are sold as part of a complete 
BiB solution or individually. The term ``BiB Products'' does not 
include components used solely for tea or coffee.
    G. ``Rapak Business'' means the development, manufacture, and sale 
of BiB Products and filler machines for BiB Products by the Plastics 
Division of DS Smith in the United States.
    H. ``Divestiture Assets'' means the Rapak Business, including:
    1. All of Defendants' rights, title, and interests in the 
facilities located at the following addresses (the ``Divestiture 
Facilities''):
    a. 7430 New Augusta Road, Indianapolis, Indiana 46268 
(``Indianapolis Plant'');
    b. 6907 Coffman Road, Indianapolis, Indiana 46268 (``Indianapolis 
Warehouse'');
    c. 29959 Ahern Avenue, Union City, California 94587 (``Union City 
Plant''); and

[[Page 12021]]

    d. 1020 Davey Road, Woodbridge, Illinois 60517;
    2. The DS Smith production lines listed in Appendix A (the 
``Divested Lines'');
    3. The DS Smith injection molding machines listed in Appendix B and 
all molds and dies, fitment assembly machines, and machinery used to 
manufacture fitments for the Rapak Business (the ``Divested Fitment 
Equipment'');
    4. At the option of Acquirer, all other tangible assets related to 
or used in connection with the Rapak Business, including but not 
limited to: All manufacturing equipment, quality assurance equipment, 
research and development equipment, machine assembly equipment, tooling 
and fixed assets, personal property, inventory, office furniture, 
materials, supplies, and other tangible property; all licenses, 
permits, certifications, and authorizations issued by any governmental 
organization; all contracts, teaming arrangements, agreements, leases, 
commitments, certifications, and understandings, including supply 
agreements; all customer lists, contracts, accounts, and credit 
records; all repair and performance records; and all other records;
    5. All intangible assets related to or used in connection with the 
Rapak Business, including but not limited to: All patents; licenses and 
sublicenses; intellectual property; copyrights; trademarks, trade 
names, service marks, and service names (including the Rapak name and 
all trademarks, service marks, and service names associated with the 
Rapak brand); technical information; computer software and related 
documentation; customer relationships, agreements, and contracts; know-
how; trade secrets; drawings; blueprints; designs; design protocols; 
specifications for materials; specifications for parts and devices; 
safety procedures for the handling of materials and substances; quality 
assurance and control procedures; design tools and simulation 
capability; all manuals and technical information DS Smith provides to 
its own employees, customers, suppliers, agents, or licensees; and all 
research data concerning historic and current research and development 
efforts, including but not limited to designs of experiments and the 
results of successful and unsuccessful designs and experiments; and
    6. At the option of Acquirer, inventory of BiB Products up to the 
amount sold by the Rapak Business in any two (2) months in 2019, with 
the specific months to be determined by Acquirer.
    I. ``Relevant Employees'' means all employees engaged in the Rapak 
Business.

III. Applicability

    A. This Final Judgment applies to Liqui-Box, Olympus Growth, and DS 
Smith, as defined above, and all other persons in active concert or 
participation with any of them who receive actual notice of this Final 
Judgment by personal service or otherwise.
    B. If, prior to complying with Section IV and Section V of this 
Final Judgment, Defendants sell or otherwise dispose of all or 
substantially all of their assets or of lesser business units that 
include the Divestiture Assets, Defendants must require the purchaser 
to be bound by the provisions of this Final Judgment. Defendants need 
not obtain such an agreement from Acquirer of the assets divested 
pursuant to this Final Judgment.

IV. Divestitures

    A. Defendants are ordered and directed, within forty-five (45) 
calendar days after the Court's entry of the Asset Preservation 
Stipulation and Order in this matter, to divest the Divestiture Assets 
in a manner consistent with this Final Judgment to TriMas or an 
alternative Acquirer acceptable to the United States, in its sole 
discretion. The United States, in its sole discretion, may agree to one 
or more extensions of this time period not to exceed sixty (60) 
calendar days in total and will notify the Court in such circumstances. 
Defendants agree to use their best efforts to divest the Divestiture 
Assets as expeditiously as possible.
    B. Prior to the divestiture of the Divestiture Assets pursuant to 
Paragraph IV(A), Defendants must relocate any Divested Lines located at 
DS Smith's facility located at 1201 Windham Parkway, Romeoville, 
Illinois 60446 (``Romeoville Plant'') to one or more of the Divestiture 
Facilities, as determined by Acquirer, and must ensure that all 
Divested Lines are fully operational at the time of the divestiture.
    C. In the event Defendants are attempting to divest the Divestiture 
Assets to an Acquirer other than TriMas, Defendants promptly must make 
known, by usual and customary means, the availability of the 
Divestiture Assets. Defendants must inform any person making an inquiry 
regarding a possible purchase of the Divestiture Assets that they are 
being divested pursuant to this Final Judgment and provide that person 
with a copy of this Final Judgment. Defendants must offer to furnish to 
all prospective Acquirers, subject to customary confidentiality 
assurances, all information and documents relating to the Divestiture 
Assets customarily provided in a due diligence process, except 
information or documents subject to the attorney-client privilege or 
work-product doctrine. Defendants must make available such information 
to the United States at the same time that such information is made 
available to any other person.
    D. Defendants must provide Acquirer and the United States with 
reasonable access to Relevant Employees and with organization charts 
and all information relating to Relevant Employees, including name, job 
title, past experience relating to the Divestiture Assets, 
responsibilities, training and educational history, relevant 
certifications, and to the extent permissible by law, job performance 
evaluations, and current salary and benefits information, to enable 
Acquirer to make offers of employment. Upon request, Defendants must 
promptly make Relevant Employees available for interviews with Acquirer 
during normal business hours at a mutually agreeable location and will 
not interfere with efforts by Acquirer to employ Relevant Employees, 
such as by offering to increase the salary or benefits of Relevant 
Employees other than as part of a company-wide increase in salary or 
benefits granted in the ordinary course of business. Defendants' 
obligations under this paragraph will expire ninety (90) calendar days 
after the divestiture of the Divestiture Assets under Paragraph IV(A).
    E. For any Relevant Employees who elect employment with Acquirer in 
the period provided for by Paragraph IV(D), Defendants must waive all 
noncompete and nondisclosure agreements, vest all unvested pension and 
other equity rights, and provide all other benefits that the Relevant 
Employees would generally be provided if transferred to a buyer of an 
ongoing business. For a period of twelve (12) months from the filing of 
the Complaint in this matter, Defendants may not solicit to hire, or 
hire, any Relevant Employee who was hired by Acquirer, unless: (1) The 
individual is terminated or laid off by Acquirer; or (2) Acquirer 
agrees in writing that Defendants may solicit or hire that individual. 
Nothing in Paragraphs IV(D) and (E) prohibits Defendants from 
maintaining any reasonable restrictions on the disclosure by any 
Relevant Employee who accepts an offer of employment with Acquirer of 
the Defendant's proprietary non-public

[[Page 12022]]

information that is: (1) Not otherwise required to be disclosed by this 
Final Judgment; (2) related solely to Defendants' businesses and 
clients; and (3) unrelated to the Divestiture Assets.
    F. Defendants must permit prospective Acquirers of the Divestiture 
Assets to have reasonable access to make inspections of the physical 
facilities of the Divestiture Assets, the Divested Lines, and the 
Divested Fitment Equipment, wherever located; access to any and all 
environmental, zoning, and other permit documents and information; and 
access to any and all financial, operational, or other documents and 
information customarily provided as part of a due diligence process.
    G. Defendants must warrant to Acquirer that each asset will be 
fully operational on the date of sale.
    H. Defendants will not take any action that will impede in any way 
the permitting, operation, or divestiture of the Divestiture Assets.
    I. Defendants must make best efforts to assign, subcontract, or 
otherwise transfer all contracts related to the Divestiture Assets, 
including all supply and sales contracts, to Acquirer. Defendants must 
not interfere with any negotiations between Acquirer and a contracting 
party.
    J. Within one-hundred and eighty (180) calendar days after the 
Court's entry of the Asset Preservation Stipulation and Order in this 
matter, Defendants must ensure that the Divested Fitment Equipment is 
relocated to, and fully operational at, one or more locations as 
specified by Acquirer.
    K. At the option of Acquirer, Defendants must enter into a supply 
agreement for the manufacture of fitments for the Rapak Business 
sufficient to meet Acquirer's needs, as determined by Acquirer, for a 
period of up to six (6) months. Upon Acquirer's request, the United 
States, in its sole discretion, may approve one or more extensions of 
this supply agreement, for a total of up to an additional six (6) 
months. If Acquirer seeks an extension of the term of this supply 
agreement, Defendants must notify the United States in writing at least 
one (1) month prior to the date the supply agreement expires. The terms 
and conditions of any contractual arrangement meant to satisfy this 
provision must be reasonably related to market conditions for the Rapak 
Business.
    L. At the option of Acquirer, Defendants must enter into a 
transition services agreement for service and support relating to the 
Rapak Business for a period of up to twelve (12) months. The United 
States, in its sole discretion, may approve one or more extensions of 
this transition services agreement, for a total of up to an additional 
six (6) months. If Acquirer seeks an extension of the term of this 
transition services agreement, Defendants must notify the United States 
in writing at least one (1) month prior to the date the agreement 
expires. The terms and conditions of any contractual arrangement meant 
to satisfy this provision must be reasonably related to market 
conditions for the services provided. The employee(s) of Defendants 
tasked with providing these transition services must not share any 
competitively sensitive information of Acquirer with any other employee 
of Defendants.
    M. Defendants must warrant to Acquirer: (1) That there are no 
material defects in the environmental, zoning, or other permits 
pertaining to the operation of the Divestiture Assets; and (2) that 
following the sale of the Divestiture Assets, Defendants will not 
undertake, directly or indirectly, any challenges to the environmental, 
zoning, or other permits relating to the operation of the Divestiture 
Assets.
    N. Unless the United States otherwise consents in writing, the 
divestiture pursuant to Section IV or by a Divestiture Trustee 
appointed pursuant to Section V of this Final Judgment must include the 
entire Divestiture Assets and must be accomplished in such a way as to 
satisfy the United States, in its sole discretion, that the Divestiture 
Assets can and will be used by Acquirer as part of a viable, ongoing 
business in the development, manufacture, and sale of BiB Products for 
dairy, post-mix, smoothie, and wine. It must be demonstrated to the 
sole satisfaction of the United States that the Divestiture Assets will 
remain viable and that the divestiture of such assets will remedy the 
competitive harm alleged in the Complaint. If any of the terms of an 
agreement between Defendants and Acquirer to effectuate the 
divestitures required by the Final Judgment varies from the terms of 
this Final Judgment then, to the extent that Defendants cannot fully 
comply with both terms, this Final Judgment will determine Defendants' 
obligations. The divestitures, whether pursuant to Section IV or 
Section V of this Final Judgment:

    (1) Must be made to an Acquirer that, in the United States' sole 
judgment, has the intent and capability (including the necessary 
managerial, operational, technical, and financial capability) of 
competing effectively in the business in the development, 
manufacture, and sale of BiB Products for dairy, post-mix, smoothie, 
and wine; and
    (2) must be accomplished so as to satisfy the United States, in 
its sole discretion, that none of the terms of any agreement between 
an Acquirer and Defendants give Defendants the ability unreasonably 
to raise Acquirer's costs, to lower Acquirer's efficiency, or 
otherwise to interfere in the ability of Acquirer to compete 
effectively.

V. Appointment of Divestiture Trustee

    A. If Defendants have not divested the Divestiture Assets within 
the time period specified in Paragraph IV(A), Defendants must notify 
the United States of that fact in writing. Upon application of the 
United States, the Court shall appoint a Divestiture Trustee selected 
by the United States and approved by the Court to effect the 
divestiture of the Divestiture Assets.
    B. After the appointment of a Divestiture Trustee becomes 
effective, only the Divestiture Trustee will have the right to sell the 
Divestiture Assets. The Divestiture Trustee will have the power and 
authority to accomplish the divestiture to an Acquirer acceptable to 
the United States, in its sole discretion, at such price and on such 
terms as are then obtainable upon reasonable effort by the Divestiture 
Trustee, subject to the provisions of Sections IV, V, and VI of this 
Final Judgment, and will have such other powers as the Court deems 
appropriate. Subject to Paragraph V(D) of this Final Judgment, the 
Divestiture Trustee may hire at the cost and expense of Defendants any 
agents or consultants, including, but not limited to, investment 
bankers, attorneys, and accountants, who will be solely accountable to 
the Divestiture Trustee, reasonably necessary in the Divestiture 
Trustee's judgment to assist in the divestiture. Any such agents or 
consultants will serve on such terms and conditions as the United 
States approves, including confidentiality requirements and conflict of 
interest certifications.
    C. Defendants will not object to a sale by the Divestiture Trustee 
on any ground other than the Divestiture Trustee's malfeasance. Any 
such objections by Defendants must be conveyed in writing to the United 
States and the Divestiture Trustee within ten (10) calendar days after 
the Divestiture Trustee has provided the notice required under Section 
VI.
    D. The Divestiture Trustee will serve at the cost and expense of 
Defendants pursuant to a written agreement, on such terms and 
conditions as the United States approves, including confidentiality 
requirements and conflict of interest certifications. The Divestiture 
Trustee will account for all

[[Page 12023]]

monies derived from the sale of the assets sold by the Divestiture 
Trustee and all costs and expenses so incurred. After approval by the 
Court of the Divestiture Trustee's accounting, including fees for any 
of its services yet unpaid and those of agents and consultants retained 
by the Divestiture Trustee, all remaining money will be paid to 
Defendants and the trust will then be terminated. The compensation of 
the Divestiture Trustee and agents and consultants retained by the 
Divestiture Trustee must be reasonable in light of the value of the 
Divestiture Assets and based on a fee arrangement that provides the 
Divestiture Trustee with incentives based on the price and terms of the 
divestiture and the speed with which it is accomplished, but the 
timeliness of the divestiture is paramount. If the Divestiture Trustee 
and Defendants are unable to reach agreement on the Divestiture 
Trustee's or any agents' or consultants' compensation or other terms 
and conditions of engagement within fourteen (14) calendar days of the 
appointment of the Divestiture Trustee, the United States may, in its 
sole discretion, take appropriate action, including making a 
recommendation to the Court. The Divestiture Trustee will, within three 
(3) business days of hiring any other agents or consultants, provide 
written notice of such hiring and the rate of compensation to 
Defendants and the United States.
    E. Defendants must use their best efforts to assist the Divestiture 
Trustee in accomplishing the required divestiture. The Divestiture 
Trustee and any agents or consultants retained by the Divestiture 
Trustee must have full and complete access to the personnel, books, 
records, and facilities of the business to be divested, and Defendants 
must provide or develop financial and other information relevant to 
such business as the Divestiture Trustee may reasonably request, 
subject to reasonable protection for trade secrets; other confidential 
research, development, or commercial information; or any applicable 
privileges. Defendants will take no action to interfere with or to 
impede the Divestiture Trustee's accomplishment of the divestiture.
    F. After its appointment, the Divestiture Trustee will file monthly 
reports with the United States setting forth the Divestiture Trustee's 
efforts to accomplish the divestiture ordered under this Final 
Judgment. Such reports will include the name, address, and telephone 
number of each person who, during the preceding month, made an offer to 
acquire, expressed an interest in acquiring, entered into negotiations 
to acquire, or was contacted or made an inquiry about acquiring any 
interest in the Divestiture Assets and will describe in detail each 
contact with any such person. The Divestiture Trustee will maintain 
full records of all efforts made to divest the Divestiture Assets.
    G. If the Divestiture Trustee has not accomplished the divestiture 
ordered under this Final Judgment within six (6) months after its 
appointment, the Divestiture Trustee will promptly file with the Court 
a report setting forth: (1) The Divestiture Trustee's efforts to 
accomplish the required divestiture; (2) the reasons, in the 
Divestiture Trustee's judgment, why the required divestiture has not 
been accomplished; and (3) the Divestiture Trustee's recommendations. 
To the extent such reports contain information that the Divestiture 
Trustee deems confidential, such reports will not be filed in the 
public docket of the Court. The Divestiture Trustee will at the same 
time furnish such report to the United States, which will have the 
right to make additional recommendations consistent with the purpose of 
the trust. The Court thereafter shall enter such orders as it deems 
appropriate to carry out the purpose of the Final Judgment, which may, 
if necessary, include extending the trust and the term of the 
Divestiture Trustee's appointment by a period requested by the United 
States.
    H. If the United States determines that the Divestiture Trustee has 
ceased to act or failed to act diligently or in a reasonably cost-
effective manner, the United States may recommend the Court appoint a 
substitute Divestiture Trustee.

VI. Notice of Proposed Divestiture

    A. Within two (2) business days following execution of a definitive 
divestiture agreement, Defendants or the Divestiture Trustee, whichever 
is then responsible for effecting the divestiture required herein, must 
notify the United States of any proposed divestiture required by 
Section IV or Section V of this Final Judgment. If the Divestiture 
Trustee is responsible, it will similarly notify Defendants. The notice 
must set forth the details of the proposed divestiture and list the 
name, address, and telephone number of each person not previously 
identified who offered or expressed an interest in or desire to acquire 
any ownership interest in the Divestiture Assets, together with full 
details of the same.
    B. Within fifteen (15) calendar days of receipt by the United 
States of such notice, the United States may request from Defendants, 
the proposed Acquirer, any other third party, or the Divestiture 
Trustee, if applicable, additional information concerning the proposed 
divestiture, the proposed Acquirer, and any other potential Acquirer. 
Defendants and the Divestiture Trustee must furnish any additional 
information requested within fifteen (15) calendar days of the receipt 
of the request, unless the parties otherwise agree.
    C. Within thirty (30) calendar days after receipt of the notice or 
within twenty (20) calendar days after the United States has been 
provided the additional information requested from Defendants, the 
proposed Acquirer, any third party, and the Divestiture Trustee, 
whichever is later, the United States will provide written notice to 
Defendants and the Divestiture Trustee, if there is one, stating 
whether or not, in its sole discretion, it objects to Acquirer or any 
other aspect of the proposed divestiture. If the United States provides 
written notice that it does not object, the divestiture may be 
consummated, subject only to Defendants' limited right to object to the 
sale under Paragraph V(C) of this Final Judgment. Absent written notice 
that the United States does not object to the proposed Acquirer or upon 
objection by the United States, a divestiture proposed under Section IV 
or Section V must not be consummated. Upon objection by Defendants 
under Paragraph V(C), a divestiture proposed under Section V must not 
be consummated unless approved by the Court.

VII. Financing

    Defendants must not finance all or any part of any purchase made 
pursuant to Section IV or Section V of this Final Judgment.

VIII. Asset Preservation

    Until the divestiture required by this Final Judgment has been 
accomplished, Defendants must take all steps necessary to comply with 
the Asset Preservation Stipulation and Order entered by the Court. 
Defendants will take no action that would jeopardize the divestiture 
ordered by the Court.

IX. Affidavits

    A. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, and every thirty (30) calendar days thereafter until 
the divestiture has been completed under Section IV or Section V, 
Defendants must deliver to the United States an affidavit, signed by 
each Defendant's Chief Financial Officer and highest-ranking officer or 
partner, which must describe the fact and manner of Defendants' 
compliance with Section IV or Section V of this Final Judgment. Each 
such affidavit must

[[Page 12024]]

include the name, address, and telephone number of each person who, 
during the preceding thirty (30) calendar days, made an offer to 
acquire, expressed an interest in acquiring, entered into negotiations 
to acquire, or was contacted or made an inquiry about acquiring, any 
interest in the Divestiture Assets, and must describe in detail each 
contact with any such person during that period. Each such affidavit 
must also include a description of the efforts Defendants have taken to 
complete the sale of or solicit buyers for the Divestiture Assets, and 
to provide required information to prospective Acquirers, including the 
limitations, if any, on such information. Assuming the information set 
forth in the affidavit is true and complete, any objection by the 
United States to information provided by Defendants, including 
limitation on information, must be made within fourteen (14) calendar 
days of receipt of such affidavit.
    B. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, Defendants must deliver to the United States an 
affidavit that describes in reasonable detail all actions Defendants 
have taken and all steps Defendants have implemented on an ongoing 
basis to comply with Section VIII of this Final Judgment. Defendants 
must deliver to the United States an affidavit describing any changes 
to the efforts and actions outlined in Defendants' earlier affidavits 
filed pursuant to this Section within fifteen (15) calendar days after 
the change is implemented.
    C. Defendants must keep all records of all efforts made to preserve 
and divest the Divestiture Assets until one (1) year after such 
divestiture has been completed.

X. Compliance Inspection

    A. For the purposes of determining or securing compliance with this 
Final Judgment, or of any related orders such as any Asset Preservation 
Stipulation and Order or of determining whether the Final Judgment 
should be modified or vacated, and subject to any legally-recognized 
privilege, from time to time authorized representatives of the United 
States, including agents retained by the United States, must, upon 
written request of an authorized representative of the Assistant 
Attorney General in charge of the Antitrust Division and on reasonable 
notice to Defendants, be permitted:

    (1) Access during Defendants' office hours to inspect and copy 
or, at the option of the United States, to require Defendants to 
provide electronic copies of all books, ledgers, accounts, records, 
data, and documents in the possession, custody, or control of 
Defendants relating to any matters contained in this Final Judgment; 
and
    (2) to interview, either informally or on the record, 
Defendants' officers, employees, or agents, who may have their 
individual counsel present, regarding such matters. The interviews 
must be subject to the reasonable convenience of the interviewee and 
without restraint or interference by Defendants.

    B. Upon the written request of an authorized representative of the 
Assistant Attorney General in charge of the Antitrust Division, 
Defendants must submit written reports or response to written 
interrogatories, under oath if requested, relating to any of the 
matters contained in this Final Judgment as may be requested.
    C. No information or documents obtained by the means provided in 
Section X will be divulged by the United States to any person other 
than an authorized representative of the executive branch of the United 
States, except in the course of legal proceedings to which the United 
States is a party (including grand jury proceedings), for the purpose 
of securing compliance with this Final Judgment, or as otherwise 
required by law.
    D. If at the time that Defendants furnish information or documents 
to the United States, Defendants represent and identify in writing the 
material in any such information or documents to which a claim of 
protection may be asserted under Rule 26(c)(1)(G) of the Federal Rules 
of Civil Procedure, and Defendants mark each pertinent page of such 
material, ``Subject to claim of protection under Rule 26(c)(1)(G) of 
the Federal Rules of Civil Procedure,'' then the United States will 
give Defendants ten (10) calendar days' notice prior to divulging such 
material in any legal proceeding (other than a grand jury proceeding).

XI. No Reacquisition

    Defendants may not reacquire any part of the Divestiture Assets 
during the term of this Final Judgment.

XII. Retention of Jurisdiction

    The Court retains jurisdiction to enable any party to this Final 
Judgment to apply to the Court at any time for further orders and 
directions as may be necessary or appropriate to carry out or construe 
this Final Judgment, to modify any of its provisions, to enforce 
compliance, and to punish violations of its provisions.

XIII. Enforcement of Final Judgment

    A. The United States retains and reserves all rights to enforce the 
provisions of this Final Judgment, including the right to seek an order 
of contempt from the Court. Defendants agree that in any civil contempt 
action, any motion to show cause, or any similar action brought by the 
United States regarding an alleged violation of this Final Judgment, 
the United States may establish a violation of this Final Judgment and 
the appropriateness of any remedy therefor by a preponderance of the 
evidence, and Defendants waive any argument that a different standard 
of proof should apply.
    B. This Final Judgment should be interpreted to give full effect to 
the procompetitive purposes of the antitrust laws and to restore the 
competition the United States alleged was harmed by the challenged 
conduct. Defendants agree that they may be held in contempt of, and 
that the Court may enforce, any provision of this Final Judgment that, 
as interpreted by the Court in light of these procompetitive principles 
and applying ordinary tools of interpretation, is stated specifically 
and in reasonable detail, whether or not it is clear and unambiguous on 
its face. In any such interpretation, the terms of this Final Judgment 
should not be construed against either party as the drafter.
    C. In any enforcement proceeding in which the Court finds that 
Defendants have violated this Final Judgment, the United States may 
apply to the Court for a one-time extension of this Final Judgment, 
together with other relief as may be appropriate. In connection with 
any successful effort by the United States to enforce this Final 
Judgment against a Defendant, whether litigated or resolved before 
litigation, that Defendant agrees to reimburse the United States for 
the fees and expenses of its attorneys, as well as any other costs, 
including experts' fees, incurred in connection with that enforcement 
effort, including in the investigation of the potential violation.
    D. For a period of four (4) years following the expiration of the 
Final Judgment, if the United States has evidence that a Defendant 
violated this Final Judgment before it expired, the United States may 
file an action against that Defendant in this Court requesting that the 
Court order: (1) Defendant to comply with the terms of this Final 
Judgment for an additional term of at least four years following the 
filing of the enforcement action under this Section; (2) any 
appropriate contempt remedies; (3) any additional relief needed to 
ensure Defendant complies with the terms of the Final Judgment; and (4) 
fees or expenses as called for in Paragraph XIII(C).

[[Page 12025]]

XIV. Expiration of Final Judgment

    Unless the Court grants an extension, this Final Judgment will 
expire ten (10) years from the date of its entry, except that after 
five (5) years from the date of its entry, this Final Judgment may be 
terminated upon notice by the United States to the Court and Defendants 
that the divestitures have been completed and that the continuation of 
the Final Judgment no longer is necessary or in the public interest.

XV. Public Interest Determination

    Entry of this Final Judgment is in the public interest. The parties 
have complied with the requirements of the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16, including making copies available to the 
public of this Final Judgment, the Competitive Impact Statement, any 
comments thereon, and the United States' responses to comments. Based 
upon the record before the Court, which includes the Competitive Impact 
Statement and any comments and responses to comments filed with the 
Court, entry of this Final Judgment is in the public interest.

Date: ________
[Court approval subject to procedures of Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16]
-----------------------------------------------------------------------
United States District Judge

Appendix A

    1. Production Line R01 (located at the Romeoville Plant);
    2. Production Line R02 (located at the Romeoville Plant);
    3. Production Line R12 (located at the Romeoville Plant);
    4. Production Line UC01 (located at the Union City Plant);
    5. Production Line UC03 (located at the Union City Plant);
    6. Production Line N03 (located at the Indianapolis Plant); and
    7. Production Line N04 (located at the Indianapolis Plant).

Appendix B

    1. Injection Molding Machine (``IM'') 96 (located at the Worldwide 
Dispensers location at 78 2nd Avenue S, Lester Prairie, Minnesota 55354 
(``Lester Prairie Plant''));
    2. IM 542 (located at the Lester Prairie Plant);
    3. IM 747 (located at the Lester Prairie Plant);
    4. IM 599 (located at the Lester Prairie Plant);
    5. IM 345 (located at the Lester Prairie Plant);
    6. IM 515 (located at the Lester Prairie Plant);
    7. IM 583 (located at the Worldwide Dispensers location at 595 
Territorial Drive, Bolingbrook, Illinois 60440 (``Bolingbrook Plant'');
    8. IM 373 (located at the Bolingbrook Plant);
    9. IM 294 (located at the Bolingbrook Plant); and
    10. IM 80 (located at the Bolingbrook Plant).

United States District Court for the District of Columbia

    United States of America, Plaintiff, v. Liqui-Box, Inc., Olympus 
Growth Fund VI, L.P., and DS Smith Plc, Defendants.

Civil Action No.: 1:20-cv-00464
 Judge: Hon. Christopher Cooper

Competitive Impact Statement

    The United States of America, under Section 2(b) of the Antitrust 
Procedures and Penalties Act, 15 U.S.C. 16(b)-(h) (the ``APPA'' or 
``Tunney Act''), files this Competitive Impact Statement relating to 
the proposed Final Judgment submitted for entry in this civil antitrust 
proceeding.

I. Nature and Purpose of the Proceeding

    On March 5, 2019, Defendant Olympus Growth Fund VI, L.P. 
(``Olympus''), through its portfolio company Defendant Liqui-Box, Inc. 
(``Liqui-Box''), agreed to acquire Defendant DS Smith plc's (``DS 
Smith'') Plastics Division (``DS Smith Plastics'') for approximately 
$500 million, making the combined company one of the largest bag-in-box 
(``BiB'') suppliers in the United States. The United States filed a 
civil antitrust Complaint on February 19, 2020, seeking to enjoin the 
proposed acquisition. The Complaint alleges that the likely effect of 
this acquisition would be to substantially lessen competition for the 
development, manufacture, and sale of dairy, post-mix, smoothie, and 
wine BiBs in the United States, in violation of Section 7 of the 
Clayton Act, 15 U.S.C. 18.
    At the same time the Complaint was filed, the United States filed 
an Asset Preservation Stipulation and Order (``APSO'') and proposed 
Final Judgment, which are designed to address the anticompetitive 
effects of the acquisition. Under the proposed Final Judgment, which is 
explained more fully below, the Defendants are required to divest all 
of DS Smith's product lines that overlap with product lines offered by 
Liqui-Box in the United States, including its dairy, post-mix, 
smoothie, and wine BiB product lines. Under the terms of the APSO, the 
Defendants must take certain steps to ensure that the divested assets 
are preserved and operated in such a way as to ensure that the products 
and services produced by or sold under the divested assets continue to 
be ongoing, economically viable competitive product lines.
    The United States and the Defendants have stipulated that the 
proposed Final Judgment may be entered after compliance with the APPA. 
Entry of the proposed Final Judgment will terminate this action, except 
that the Court will retain jurisdiction to construe, modify, or enforce 
the provisions of the proposed Final Judgment and to punish violations 
thereof.

II. Description of Events Giving Rise to the Alleged Violation

A. The Defendants and the Proposed Transaction

    Olympus, a fund managed by private equity firm Olympus Partners, is 
a Delaware limited partnership with headquarters in Stamford, 
Connecticut. In 2018, Olympus Partners had approximately $8.5 billion 
total capital under management between its different funds, with 
Olympus comprising approximately $2.3 billion of that total. Liqui-Box, 
a company owned by Olympus, is a Delaware corporation with headquarters 
in Richmond, Virginia. Liqui-Box is a global manufacturer of packaging 
and packaging equipment, including BiBs, with four U.S. manufacturing 
facilities, as well as additional facilities across the world. In 2018, 
Liqui-Box had total sales of $177 million, including approximately $123 
million in the United States.
    DS Smith is a United Kingdom public limited company with 
headquarters in London, England. DS Smith is a global manufacturer of 
packaging, packaging equipment, and recycled paper. DS Smith Plastics 
manufactures flexible packaging and dispensing solutions, rigid 
packaging, injection-molded products, and foam products. Among DS Smith 
Plastics' flexible packaging products are BiBs, which are primarily 
sold under the Rapak brand name in the United States. DS Smith Plastics 
has its U.S. headquarters in Romeoville, Illinois, and operates five 
plants in the United States, as well as additional plants across the 
world. In 2018, DS Smith Plastics had total sales of $479 million, 
including approximately $137 million in sales of BiBs and other goods 
in the United States.
    Pursuant to a Stock Purchase Agreement dated March 5, 2019, Liqui-
Box agreed to acquire DS Smith Plastics for approximately $500 million.

B. Industry Background

    BiBs are used to store and dispense liquids such as milk, post-mix,

[[Page 12026]]

smoothies, and wine. The components of a BiB include a flexible plastic 
bag and an attached fitment. BiBs typically hold between one and six 
gallons of liquid, but they also come in smaller and larger sizes. The 
attached fitment facilitates the transfer of liquids into and out of 
the bag.
    The flexible plastic bag component of a BiB is typically made up of 
one to five layers of film. The films are most often made of 
polyethylene (``PE''), but also can be made with ethylene vinyl alcohol 
(``EVOH'') or other materials, and are bound together using heat 
sealing. Customers require different numbers and types of layers to 
meet individual product demands. For example, the most basic bags 
consist of a single layer of PE that secures the liquid during 
transport. More sophisticated bags have additional layers of engineered 
film that add durability, metallization, and oxygen, moisture, or 
temperature resistance.
    The fitment component of a BiB typically is made from resin using 
injection molding and attached to the flexible plastic bag component 
via heat sealing. The design of the fitment is determined by the liquid 
that will go into the bag and the method that will be used to dispense 
the liquid out of the bag. For example, if the BiB is used to dispense 
post-mix into a soda dispenser, the fitment will be designed to attach 
to a soda dispenser. The simplest fitment is a basic cap, which can be 
flipped off or unscrewed to pour out the liquid. Highly engineered 
fitments can have specialized elements such as a built-in push-tap 
feature or an oxygen barrier to provide resistance to the elements. 
Fitments are often protected by patents due to the specialized nature 
and high degree of engineering that can be required in fitment 
manufacturing.
    BiBs are shipped to the customer, who fills the BiB with liquid 
using a filler machine that the customer typically purchases or leases 
from the BiB supplier. The customer then ships the filled BiB to a 
store, restaurant, or other food processor. For example, a post-mix 
manufacturer seeking to distribute its post-mix to a convenience store 
would purchase BiBs and a filler machine from a BiB supplier, fill the 
BiBs with the post-mix at its own facility, and then ship the filled 
BiBs to the convenience store for use in the convenience store's 
dispensing machine.
    BiBs are distinct from and have numerous advantages over other 
forms of packaging. For example, compared to rigid containers (e.g., 
jugs and bottles) and cartons, which are the other primary forms of 
packaging used for storing and transporting liquids, BiBs are smaller 
and thus reduce storage space and shelf space, both when empty and 
filled. In addition, BiBs can be a more hygienic form of dispensing 
liquids because they can reduce user contact and thus contamination. 
Further, BiBs can keep their contents fresher for longer than other 
types of packaging by allowing for minimal contact with air. Finally, 
BiBs can be more economical because they have features that allow the 
user to get all the liquid out of bag and result in less packaging 
waste when they are empty and disposed of.

C. Relevant Markets

1. Product Markets
a. Dairy BiBs
    BiBs for dairy products hold liquids such as ice cream mix, yogurt, 
milk, and cream. Dairy BiBs are typically durable bags made from PE and 
often have a flip-cap or screw-off cap fitment. Dairy BiBs are designed 
to reduce the risk of contamination and extend shelf life.
    As alleged in the Complaint, there are no substitutes for dairy 
BiBs. Dairy BiBs provide dairy liquids to customers in an easy to use, 
inexpensive format that other packaging does not offer. For example, 
rigid containers require more storage space, may not keep the dairy 
liquid as fresh, and may have a higher risk of contamination. BiBs for 
other end uses cannot be substituted for dairy BiBs due to the unique 
specifications for dairy BiBs.
    The Complaint alleges that in the event of a small but significant 
non-transitory price increase for dairy BiBs, customers would not 
substitute away from dairy BiBs in a sufficient volume to make the 
price increase unprofitable. Therefore, the Complaint alleges that the 
development, manufacture, and sale of dairy BiBs is a relevant product 
market and line of commerce within the meaning of Section 7 of the 
Clayton Act, 15 U.S.C. 18.
b. Post-Mix BiBs
    Post-mix BiBs hold concentrated drink mixes such as soda syrup and 
juice concentrates. These concentrates are often mixed with carbonated 
or non-carbonated water before being served. Post-mix BiBs are 
typically made with layers of PE or EVOH and a fitment that attaches to 
a drink dispensing machine. Bags used for post-mix must be very strong 
to accommodate high filling flow rates required by post-mix 
manufacturers. Post-mix BiBs are designed to maintain freshness and 
ensure all liquid is dispensed from the bag while minimizing leaks and 
spills and accurately dispensing the product.
    The Complaint alleges that there are no substitutes for post-mix 
BiBs. Post-mix BiBs must attach to a dispensing machine, which a rigid 
container cannot do. Moreover, BiBs for other end uses cannot be 
substituted for post-mix BiBs due to the unique fitments and bag design 
required for post-mix BiBs.
    As further alleged in the Complaint, in the event of a small but 
significant non-transitory price increase for post-mix BiBs, customers 
would not substitute away from post-mix BiBs in a sufficient volume to 
make the price increase unprofitable. Therefore, the Complaint alleges 
that the development, manufacture, and sale of post-mix BiBs is a 
relevant product market and line of commerce within the meaning of 
Section 7 of the Clayton Act, 15 U.S.C. 18.
c. Smoothie BiBs
    Smoothie BiBs hold mixes and other ingredients for smoothies and 
other drinks. Smoothie BiBs are typically made with layers of PE that 
offer low oxygen permeability. Like post-mix BiBs, most fitments on 
smoothie BiBs are designed to be attached to dispensing machines and 
are highly specialized for the particular types of machines they attach 
to. A smoothie BiB typically has a special cap into which a probe is 
inserted in order to dispense the liquid. Smoothie BiBs are designed to 
maintain the safety and freshness of the liquid, protect the taste and 
quality of these flavor-sensitive liquids, and reduce the risk of 
contamination.
    According to the Complaint, there are no substitutes for smoothie 
BiBs. Rigid containers cannot be attached to the dispensing machines 
smoothie BiBs are used in. Further, rigid containers are more expensive 
and bulkier to transport, may not keep the liquid as fresh, and may 
have a higher risk of contamination. Moreover, BiBs for other end uses 
cannot be substituted for smoothie BiBs due to the unique 
specifications required for smoothie BiBs. Fitments for smoothie BiBs, 
for example, often are designed to specifically interact with the 
dispensing machines.
    The Complaint alleges that in the event of a small but significant 
non-transitory price increase for smoothie BiBs, customers would not 
substitute away from smoothie BiBs in a sufficient volume to make the 
price increase unprofitable. Therefore, the Complaint alleges that the 
development, manufacture, and sale of smoothie BiBs is a relevant 
product market and line of commerce within the meaning of

[[Page 12027]]

Section 7 of the Clayton Act, 15 U.S.C. 18.
d. Wine BiBs
    Wine BiBs hold the wine inside of boxed wines, which are often sold 
in retail outlets. The bag component of wine BiBs is typically made 
from PE and EVOH and is designed to protect against oxidation and UV 
light. The fitment for wine BiBs is typically a push, pull, or twist 
tap that is specifically designed to avoid allowing oxygen into the bag 
when the wine is dispensed. This provides a longer shelf life for wine 
once opened as compared to traditional bottles. Because the fitments 
for wine BiBs are operated directly by individuals, they must be simple 
to operate and user friendly.
    As alleged in the Complaint, there are no substitutes for wine 
BiBs. BiBs for other end uses cannot be substituted for wine BiBs due 
to the unique specifications for wine BiBs. Both the bag and fitment 
are specially engineered to provide an oxygen barrier for the product 
that other BiBs typically do not provide. Bags and fitments that lack 
this specialized oxygen barrier would allow oxygen to seep in and 
degrade the wine, making it unsuitable for consumption after only a 
short time. Wine bottles are not adequate substitutes for wine BiBs. A 
wine BiB can keep wine fresh for up to four weeks after it is opened, 
significantly longer than a wine bottle can. Also, wine BiBs provide 
faster and more sanitary pouring for food service operators than 
bottles do, with no risk of broken glass.
    According to the Complaint, in the event of a small but significant 
non-transitory price increase for wine BiBs, customers would not 
substitute away from wine BiBs in a sufficient volume to make the price 
increase unprofitable. Therefore, the Complaint alleges that the 
development manufacture, and sale of wine BiBs is a relevant product 
market and line of commerce within the meaning of Section 7 of the 
Clayton Act, 15 U.S.C. 18.
2. Geographic Market
    The Complaint alleges that customers in the United States do not 
purchase dairy, post-mix, smoothie, and wine BiBs (collectively, the 
``Relevant BiB Products'') from suppliers located outside the United 
States. Shipping these products from outside the United States 
generally would not be economical because the shipping costs are too 
large relative to the cost of the BiB itself. In addition, BiBs 
manufactured and sold outside the United States often have different 
specifications than those manufactured and sold in the United States 
due to, for example, differences in the liquids stored in the BiBs or 
differences in dispensing machines. Further, according to the 
Complaint, it is important for a supplier of BiBs in the United States 
to be able to timely provide service to its customers who have issues 
with the BiBs, such as leakage or breakage of the bags or problems with 
the attachment of the BiBs to the filler machines. Suppliers located 
outside the United States do not have employees located in the United 
States to timely service BiB customers in the United States.
    The Complaint alleges that, in the event of a small but significant 
non-transitory increase in the price of the Relevant BiB Products, 
customers in the United States would not procure these products from 
suppliers located outside the United States in a sufficient volume to 
make such a price increase unprofitable. Accordingly, the Complaint 
alleges that the United States is a relevant geographic market within 
the meaning of Section 7 of the Clayton Act, 15 U.S.C. 18.

D. Anticompetitive Effects

    The Complaint alleges that Liqui-Box, DS Smith, and one other 
company are the only significant suppliers of dairy, post-mix, and 
smoothie BiBs to customers located in the United States. It also 
alleges that Liqui-Box and DS Smith are two of only four suppliers of 
wine BiBs to customers located in the United States.
    According to the Complaint, Liqui-Box and DS Smith compete 
vigorously with one another on the basis of price, quality, and service 
in the markets for the Relevant BiB Products in the United States. 
Competition between Liqui-Box and DS Smith has fostered innovation and 
led to the development of new types of BiBs and product features. The 
proposed acquisition would eliminate the substantial head-to-head 
competition between Liqui-Box and DS Smith and the benefits that 
customers have realized from that competition in the form of lower 
prices, better quality and service, and innovation. By eliminating DS 
Smith as a competitor in the development, manufacture, and sale of the 
Relevant BiB Products in the United States, the proposed acquisition of 
DS Smith Plastics would substantially increase the likelihood that 
Liqui-Box would increase prices, reduce quality and service, and 
diminish investment in research and development below what it would 
have been absent the acquisition.
    According to the Complaint, the proposed acquisition, therefore, 
would likely substantially lessen competition in the development, 
manufacture, and sale of the Relevant BiB Products in the United States 
in violation of Section 7 of the Clayton Act, 15 U.S.C. 18.

E. Entry

    The Complaint alleges that entry into the development, manufacture, 
and sale of the Relevant BiB Products would not be timely, likely, or 
sufficient to prevent the harm to competition caused by Liqui-Box's 
proposed acquisition of DS Smith Plastics.
    According to the Complaint, entry into the markets for the Relevant 
BiB Products is costly and time consuming. Significant upfront capital 
expenditures are required to enter. The machinery to manufacture BiBs, 
including injection molding machines for the fitments and production 
lines that seal the bags and attach the fitments, is expensive and 
highly engineered. Manufacturing BiBs in accordance with customer 
requirements requires skilled employees and industry know-how that can 
take years to establish. Further, customers demand that suppliers have 
a proven ability to supply BiBs with the required specifications so 
that their BiBs do not leak or break and are able to store the liquids 
for the required amount of time without spoiling. This reputation for 
having a quality product takes significant time to build. Finally, a 
new entrant would need to hire trained technicians capable of providing 
timely service to customers when BiBs leak, break, or encounter other 
product quality issues.

III. Explanation of the Proposed Final Judgment

    The divestiture required by the proposed Final Judgment will remedy 
the loss of competition alleged in the Complaint by establishing an 
independent and economically viable competitor with the scale and scope 
to compete effectively in the markets for the Relevant BiB Products in 
the United States. Paragraph IV(A) of the proposed Final Judgment 
requires the Defendants to divest DS Smith Plastics' Rapak Business 
within 45 calendar days of the Court's entry of the APSO to TriMas 
Corporation or another acquirer acceptable to the United States in its 
sole discretion.\1\ The divestiture

[[Page 12028]]

includes four facilities (production facilities in Indianapolis, 
Indiana and Union City, California; an office and production facility 
in Woodbridge, Illinois; and a warehouse in Indianapolis, Indiana); 
seven production lines that are used to manufacture dairy, post-mix, 
smoothie, and wine BiBs as well as BiBs for other products; injection-
molding and other equipment used to manufacture fitments; at the 
acquirer's option, all other tangible assets related to or used in 
connection with the Rapak Business; all intangible assets related to or 
used in connection with the Rapak Business (including the Rapak brand); 
and, at the acquirer's option, certain inventory. In order to enhance 
its viability, the divestiture includes not only DS Smith's dairy, 
post-mix, smoothie, and wine BiB product lines, but also all other DS 
Smith BiB product lines that overlap with product lines offered by 
Liqui-Box in the United States. This includes, for example, BiBs for 
edible oil, liquid egg, and tomato products. Paragraph IV(N) of the 
proposed Final Judgment requires that the divestiture assets must be 
divested in such a way as to satisfy the United States in its sole 
discretion that they can and will be operated by the purchaser as part 
of a viable, ongoing business that can compete effectively in the 
development, manufacture, and sale of dairy, post-mix, smoothie, and 
wine BiBs.
---------------------------------------------------------------------------

    \1\ Paragraph II(G) of the proposed Final Judgment defines the 
``Rapak Business'' as ``the development, manufacture, and sale of 
BiB Products and filler machines for BiB Products by the Plastics 
Division of DS Smith in the United States.'' Paragraph II(F) defines 
``BiB Products'' as ``all components of Bag-in-Box (``BiB'') 
packaging and solutions, including, but not limited to, bags and 
fitments, whether the bags or fitments are sold as part of a 
complete BiB solution or individually'' but ``does not include 
components used solely for tea or coffee.''
---------------------------------------------------------------------------

    Paragraph IV(B) of the proposed Final Judgment requires that, prior 
to the divestiture, the Defendants must relocate any divested 
production lines that are currently located at DS Smith Plastics' 
Romeoville, Illinois production facility--a facility that is not being 
divested--to one or more of the production facilities included in the 
divestiture, with the specific facility to be determined by the 
acquirer. Defendants have both previously moved production lines for 
independent business reasons with little to no disruption in production 
or supply. The Defendants must also ensure that the divested production 
lines are fully operational in their new locations at the time of the 
closing of the divestiture. Three of the divested production lines are 
currently located at DS Smith Plastics' Romeoville facility. These 
production lines are to be moved to the divested production facilities 
and divested because they are used primarily for the manufacture of the 
Relevant BiB Products. In addition, Paragraph IV(J) requires that 
within 180 days after the Court's entry of the APSO, the Defendants 
must ensure that the fitment equipment to be divested is relocated to, 
and fully operational at, a facility or facilities specified by the 
acquirer.
    The proposed Final Judgment contains several provisions to 
facilitate the immediate use of the divestiture assets by the acquirer. 
Paragraph IV(K) of the proposed Final Judgment requires the Defendants, 
at the acquirer's option, to enter into a supply contract for fitments 
sufficient to meet all or part of the acquirer's needs for a period of 
up to six months. Upon the acquirer's request, the United States, in 
its sole discretion, may approve one or more extensions of any such 
agreement for a total of up to an additional six (6) months. In 
addition, Paragraph IV(L) of the proposed Final Judgment requires the 
Defendants, at the acquirer's option, to enter into a transition 
services agreement for service and support relating to the Rapak 
Business for a period of up to twelve months. The paragraph further 
provides that the United States, in its sole discretion, may approve 
one or more extensions of this transition services agreement for a 
total of up to an additional six (6) months. Paragraph IV(L) also 
provides that employees of the Defendants tasked with providing any 
transition services must not share any competitively sensitive 
information of the acquirer with any other employee of the Defendants.
    The proposed Final Judgment also contains provisions intended to 
facilitate the acquirer's efforts to hire employees engaged in the 
Rapak Business. Paragraph IV(D) of the proposed Final Judgment requires 
the Defendants to provide the acquirer with organization charts and 
information relating to these employees and to make them available for 
interviews, and it provides that the Defendants must not interfere with 
any negotiations by the acquirer to hire them. In addition, Paragraph 
IV(E) provides that, for employees who elect employment with the 
acquirer, the Defendants must waive all noncompete and nondisclosure 
agreements, vest all unvested pension and other equity rights, and 
provide all benefits that the employees would generally be provided if 
transferred to a buyer of an ongoing business. This paragraph further 
provides that, for a period of 12 months from the filing of the 
Complaint, the Defendants may not solicit to hire or hire any employee 
engaged in the Rapak Business who was hired by the acquirer, unless 
that individual is terminated or laid off by the acquirer or the 
acquirer agrees in writing that the Defendants may solicit or hire that 
individual.
    If the Defendants do not accomplish the divestiture within the 
period prescribed in the proposed Final Judgment, Section V of the 
proposed Final Judgment provides that the Court will appoint a 
divestiture trustee selected by the United States to effect the 
divestiture. If a divestiture trustee is appointed, the proposed Final 
Judgment provides that the Defendants will pay all costs and expenses 
of the trustee. The divestiture trustee's commission will be structured 
so as to provide an incentive for the trustee based on the price 
obtained and the speed with which the divestiture is accomplished. 
After the divestiture trustee's appointment becomes effective, the 
trustee will provide periodic reports to the United States setting 
forth his or her efforts to accomplish the divestiture. At the end of 
six months, if the divestiture has not been accomplished, the 
divestiture trustee and the United States will make recommendations to 
the Court, which will enter such orders as appropriate, in order to 
carry out the purpose of the trust, including by extending the trust or 
the term of the divestiture trustee's appointment.
    The proposed Final Judgment also contains provisions designed to 
promote compliance and make the enforcement of the Final Judgment as 
effective as possible. Paragraph XIII(A) provides that the United 
States retains and reserves all rights to enforce the provisions of the 
Final Judgment, including its rights to seek an order of contempt from 
the Court. Under the terms of this paragraph, the Defendants have 
agreed that in any civil contempt action, any motion to show cause, or 
any similar action brought by the United States regarding an alleged 
violation of the Final Judgment, the United States may establish the 
violation and the appropriateness of any remedy by a preponderance of 
the evidence and that the Defendants have waived any argument that a 
different standard of proof should apply. This provision aligns the 
standard for compliance obligations with the standard of proof that 
applies to the underlying offense that the compliance commitments 
address.
    Paragraph XIII(B) provides additional clarification regarding the 
interpretation of the provisions of the proposed Final Judgment. The 
proposed Final Judgment was drafted to restore competition the United 
States alleged would otherwise be harmed by the transaction. The 
Defendants agree that they will abide by the proposed Final Judgment, 
and that they may be held in contempt of this

[[Page 12029]]

Court for failing to comply with any provision of the proposed Final 
Judgment that is stated specifically and in reasonable detail, as 
interpreted in light of this procompetitive purpose.
    Paragraph XIII(C) of the proposed Final Judgment provides that if 
the Court finds in an enforcement proceeding that the Defendants have 
violated the Final Judgment, the United States may apply to the Court 
for a one-time extension of the Final Judgment, together with such 
other relief as may be appropriate. In addition, to compensate American 
taxpayers for any costs associated with investigating and enforcing 
violations of the Final Judgment, Paragraph XIII(C) provides that in 
any successful effort by the United States to enforce the Final 
Judgment against a Defendant, whether litigated or resolved before 
litigation, that the Defendants will reimburse the United States for 
attorneys' fees, experts' fees, and other costs incurred in connection 
with any enforcement effort, including the investigation of the 
potential violation.
    Paragraph XIII(D) states that the United States may file an action 
against a Defendant for violating the Final Judgment for up to four 
years after the Final Judgment has expired or been terminated. This 
provision is meant to address circumstances such as when evidence that 
a violation of the Final Judgment occurred during the term of the Final 
Judgment is not discovered until after the Final Judgment has expired 
or been terminated or when there is not sufficient time for the United 
States to complete an investigation of an alleged violation until after 
the Final Judgment has expired or been terminated. This provision, 
therefore, makes clear that, for four years after the Final Judgment 
has expired or been terminated, the United States may still challenge a 
violation that occurred during the term of the Final Judgment.
    Finally, Section XIV of the proposed Final Judgment provides that 
the Final Judgment will expire ten years from the date of its entry, 
except that after five years from the date of its entry, the Final 
Judgment may be terminated upon notice by the United States to the 
Court and the Defendants that the divestiture has been completed and 
that the continuation of the Final Judgment is no longer necessary or 
in the public interest.

IV. Remedies Available to Potential Private Litigants

    Section 4 of the Clayton Act, 15 U.S.C. 15, provides that any 
person who has been injured as a result of conduct prohibited by the 
antitrust laws may bring suit in federal court to recover three times 
the damages the person has suffered, as well as costs and reasonable 
attorneys' fees. Entry of the proposed Final Judgment neither impairs 
nor assists the bringing of any private antitrust damage action. Under 
the provisions of Section 5(a) of the Clayton Act, 15 U.S.C. 16(a), the 
proposed Final Judgment has no prima facie effect in any subsequent 
private lawsuit that may be brought against the Defendants.

V. Procedures Available for Modification of the Proposed Final Judgment

    The United States and the Defendants have stipulated that the 
proposed Final Judgment may be entered by the Court after compliance 
with the provisions of the APPA, provided that the United States has 
not withdrawn its consent. The APPA conditions entry upon the Court's 
determination that the proposed Final Judgment is in the public 
interest.
    The APPA provides a period of at least 60 days preceding the 
effective date of the proposed Final Judgment within which any person 
may submit to the United States written comments regarding the proposed 
Final Judgment. Any person who wishes to comment should do so within 60 
days of the date of publication of this Competitive Impact Statement in 
the Federal Register, or the last date of publication in a newspaper of 
the summary of this Competitive Impact Statement, whichever is later. 
All comments received during this period will be considered by the U.S. 
Department of Justice, which remains free to withdraw its consent to 
the proposed Final Judgment at any time before the Court's entry of the 
Final Judgment. The comments and the response of the United States will 
be filed with the Court. In addition, comments will be posted on the 
U.S. Department of Justice, Antitrust Division's internet website and, 
under certain circumstances, published in the Federal Register.
    Written comments should be submitted to: Katrina Rouse, Chief, 
Defense, Industrials, and Aerospace Section, Antitrust Division, U.S. 
Department of Justice, 450 Fifth Street NW, Suite 8700, Washington, DC 
20530.
    The proposed Final Judgment provides that the Court retains 
jurisdiction over this action, and the parties may apply to the Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Final Judgment.

VI. Alternatives to the Proposed Final Judgment

    As an alternative to the proposed Final Judgment, the United States 
considered a full trial on the merits against the Defendants. The 
United States could have continued the litigation and sought 
preliminary and permanent injunctions against Liqui-Box's acquisition 
of DS Smith Plastics. The United States is satisfied, however, that the 
divestiture of assets described in the proposed Final Judgment will 
remedy the anticompetitive effects alleged in the Complaint, preserving 
competition for the development, manufacture, and sale of dairy, post-
mix, smoothie, and wine BiBs in the United States. Thus, the proposed 
Final Judgment achieves all or substantially all of the relief the 
United States would have obtained through litigation, but avoids the 
time, expense, and uncertainty of a full trial on the merits of the 
Complaint.

VII. Standard of Review Under the APPA for the Proposed Final Judgment

    The Clayton Act, as amended by the APPA, requires that proposed 
consent judgments in antitrust cases brought by the United States be 
subject to a 60-day comment period, after which the Court shall 
determine whether entry of the proposed Final Judgment ``is in the 
public interest.'' 15 U.S.C. 16(e)(1). In making that determination, 
the Court, in accordance with the statute as amended in 2004, is 
required to consider:

    (A) The competitive impact of such judgment, including 
termination of alleged violations, provisions for enforcement and 
modification, duration of relief sought, anticipated effects of 
alternative remedies actually considered, whether its terms are 
ambiguous, and any other competitive considerations bearing upon the 
adequacy of such judgment that the court deems necessary to a 
determination of whether the consent judgment is in the public 
interest; and
    (B) the impact of entry of such judgment upon competition in the 
relevant market or markets, upon the public generally and 
individuals alleging specific injury from the violations set forth 
in the complaint including consideration of the public benefit, if 
any, to be derived from a determination of the issues at trial.

    15 U.S.C. 16(e)(1)(A) & (B). In considering these statutory 
factors, the Court's inquiry is necessarily a limited one as the 
government is entitled to ``broad discretion to settle with the 
defendant within the reaches of the public interest.'' United States v. 
Microsoft Corp., 56 F.3d 1448, 1461 (D.C. Cir. 1995); United States v. 
U.S. Airways Grp., Inc., 38 F. Supp. 3d 69, 75 (D.D.C. 2014) 
(explaining that the

[[Page 12030]]

``court's inquiry is limited'' in Tunney Act settlements); United 
States v. InBev N.V./S.A., No. 08-1965 (JR), 2009 U.S. Dist. LEXIS 
84787, at *3 (D.D.C. Aug. 11, 2009) (noting that a court's review of a 
consent judgment is limited and only inquires ``into whether the 
government's determination that the proposed remedies will cure the 
antitrust violations alleged in the complaint was reasonable, and 
whether the mechanism to enforce the final judgment are clear and 
manageable'').
    As the U.S. Court of Appeals for the District of Columbia Circuit 
has held, under the APPA a court considers, among other things, the 
relationship between the remedy secured and the specific allegations in 
the government's complaint, whether the proposed Final Judgment is 
sufficiently clear, whether its enforcement mechanisms are sufficient, 
and whether it may positively harm third parties. See Microsoft, 56 
F.3d at 1458-62. With respect to the adequacy of the relief secured by 
the proposed Final Judgment, a court may not ``make de novo 
determination of facts and issues.'' United States v. W. Elec. Co., 993 
F.2d 1572, 1577 (D.C. Cir. 1993) (quotation marks omitted); see also 
Microsoft, 56 F.3d at 1460-62; United States v. Alcoa, Inc., 152 F. 
Supp. 2d 37, 40 (D.D.C. 2001); United States v. Enova Corp., 107 F. 
Supp. 2d 10, 16 (D.D.C. 2000); InBev, 2009 U.S. Dist. LEXIS 84787, at 
*3. Instead, ``[t]he balancing of competing social and political 
interests affected by a proposed antitrust consent decree must be left, 
in the first instance, to the discretion of the Attorney General.'' W. 
Elec. Co., 993 F.2d at 1577 (quotation marks omitted). ``The court 
should bear in mind the flexibility of the public interest inquiry: the 
court's function is not to determine whether the resulting array of 
rights and liabilities is one that will best serve society, but only to 
confirm that the resulting settlement is within the reaches of the 
public interest.'' Microsoft, 56 F.3d at 1460 (quotation marks 
omitted). More demanding requirements would ``have enormous practical 
consequences for the government's ability to negotiate future 
settlements,'' contrary to congressional intent. Id. at 1456. ``The 
Tunney Act was not intended to create a disincentive to the use of the 
consent decree.'' Id.
    The United States' predictions about the efficacy of the remedy are 
to be afforded deference by the Court. See, e.g., Microsoft, 56 F.3d at 
1461 (recognizing courts should give ``due respect to the Justice 
Department's . . . view of the nature of its case''); United States v. 
Iron Mountain, Inc., 217 F. Supp. 3d 146, 152-53 (D.D.C. 2016) (``In 
evaluating objections to settlement agreements under the Tunney Act, a 
court must be mindful that [t]he government need not prove that the 
settlements will perfectly remedy the alleged antitrust harms[;] it 
need only provide a factual basis for concluding that the settlements 
are reasonably adequate remedies for the alleged harms.'') (internal 
citations omitted); United States v. Republic Servs., Inc., 723 F. 
Supp. 2d 157, 160 (D.D.C. 2010) (noting ``the deferential review to 
which the government's proposed remedy is accorded''); United States v. 
Archer-Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (``A 
district court must accord due respect to the government's prediction 
as to the effect of proposed remedies, its perception of the market 
structure, and its view of the nature of the case.''). The ultimate 
question is whether ``the remedies [obtained by the Final Judgment are] 
so inconsonant with the allegations charged as to fall outside of the 
`reaches of the public interest.' '' Microsoft, 56 F.3d at 1461 
(quoting W. Elec. Co., 900 F.2d at 309).
    Moreover, the Court's role under the APPA is limited to reviewing 
the remedy in relationship to the violations that the United States has 
alleged in its complaint, and does not authorize the Court to 
``construct [its] own hypothetical case and then evaluate the decree 
against that case.'' Microsoft, 56 F.3d at 1459; see also U.S. Airways, 
38 F. Supp. 3d at 75 (noting that the court must simply determine 
whether there is a factual foundation for the government's decisions 
such that its conclusions regarding the proposed settlements are 
reasonable); InBev, 2009 U.S. Dist. LEXIS 84787, at *20 (``[T]he 
`public interest' is not to be measured by comparing the violations 
alleged in the complaint against those the court believes could have, 
or even should have, been alleged.''). Because the ``court's authority 
to review the decree depends entirely on the government's exercising 
its prosecutorial discretion by bringing a case in the first place,'' 
it follows that ``the court is only authorized to review the decree 
itself,'' and not to ``effectively redraft the complaint'' to inquire 
into other matters that the United States did not pursue. Microsoft, 56 
F.3d at 1459-60.
    In its 2004 amendments to the APPA, Congress made clear its intent 
to preserve the practical benefits of using consent judgments proposed 
by the United States in antitrust enforcement, Public Law 108-237 Sec.  
221, and added the unambiguous instruction that ``[n]othing in this 
section shall be construed to require the court to conduct an 
evidentiary hearing or to require the court to permit anyone to 
intervene.'' 15 U.S.C. 16(e)(2); see also U.S. Airways, 38 F. Supp. 3d 
at 76 (indicating that a court is not required to hold an evidentiary 
hearing or to permit intervenors as part of its review under the Tunney 
Act). This language explicitly wrote into the statute what Congress 
intended when it first enacted the Tunney Act in 1974. As Senator 
Tunney explained: ``[t]he court is nowhere compelled to go to trial or 
to engage in extended proceedings which might have the effect of 
vitiating the benefits of prompt and less costly settlement through the 
consent decree process.'' 119 Cong. Rec. 24,598 (1973) (statement of 
Sen. Tunney). ``A court can make its public interest determination 
based on the competitive impact statement and response to public 
comments alone.'' U.S. Airways, 38 F. Supp. 3d at 76 (citing Enova 
Corp., 107 F. Supp. 2d at 17).

VIII. Determinative Documents

    There are no determinative materials or documents within the 
meaning of the APPA that were considered by the United States in 
formulating the proposed Final Judgment.

Dated: February 19, 2020.

Respectfully submitted,

For Plaintiff, United States of America

-----------------------------------------------------------------------

Christine A. Hill
(D.C. Bar #461048) *

Attorney, United States Department of Justice, Antitrust Division, 
Defense, Industrials, and Aerospace Section, 450 Fifth Street NW, 
Suite 8700, Washington, DC 20530, (202) 305-2738, 
[email protected].

    * Attorney of Record.

[FR Doc. 2020-04119 Filed 2-27-20; 8:45 am]
 BILLING CODE 4410-11-P